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Cryptocurrency protection: simple and efficient ways

06/05/2017 00:00
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One can be sure in telling that cryptocurrency is the safest way of money transfer between people on the basis of complete anonymity. Though, the storage and trade of virtual coins can be accompanied by some risks. Being a digital asset the cryptocurrency doesn’t have specific problems of fiat money. The only difficulties are related to financial technical aspects.

How to store cryptocurrency

The usage of digital wallet is the most popular way of digital coins storage. Such wallets are very simple to use and rather handy. How safe are they though? In case if you store cryptocurrency is your own PC, the level of security directly depends on your device technical dimensions.

In general the protection of virtual wallet on PC is similar to the protection of any confidential information. One has to be extremely cautious when using Internet and store passwords in encrypted files at external devices. In ideal the passwords should be stored nowhere and keep in your head only or store somewhere in on-line mode. We recommend you installing wallets at PC which you don’t use for Internet surfing on a daily basis.

One of the popular solutions of cryptocurrency protection is based on the usage of Linux which is considered to be almost impenetrable for viruses and hackers attacks. Besides this there is no necessity to install Linux instead of common Windows. This system can be downloaded to PC in case of necessity via USB drive.

It is also worth mentioning coins cold storage allowing the security increase ot few levels. In general it supposes cryptocurrency placement at offline wallet which limits any attemps of unauthorized access.

In most cases cold wallet is created at the device which has never been connected to Internet for example at old laptop of flash drive. But very few people know that such storage can be created outside Internet. This aspect is of great importance as well. User doesn’t have to connect Internet, install “wallet”, send coins and generate keys.

Among all variety of on-line wallets the hardware wallets are the most convenient ones and have highest level of security. These are portable devices specifically designed for cryptocurrency storage. Generally speaking such wallet is flash drive with safe and simple software and multilevel cryptography protection.

Cold wallet is indispensable for safe storage of assets in form of virtual currency. But the moment you need to transfer your coins to Internet you are sure to run into other security problems the successful resolution of which will influence your money security.

Cryptocurrency trade: key protection methods

Actively developing cryptocurrency trade poses for users a new task of searching safe way of assets storage online i.e. with constant presence of online access to wallet. Some niche participants create “hot wallet” with the help of which they conduct daily transactions and another cold wallet where they keep their main assets. Such approach has been successfully implemented at most stock exchanges. The communication with stock exchanges and currency exchange services is indispensable part of all domain participants even for those who don’t consider themselves to be cryptotraders.

All online wallets, stock exchanges and data processing systems (check here the reviews of the most popular recourses) have to run into specific security issues. As experts mention one can define with several precautions they have to take into consideration when selecting online resource for cryptocurrency transactions conducting. It means that each user has to take own precautions when dealing with cryptocurrency.

First thing you have to follow carefully is your email security as more than 90% of hacker attacks are done via access to email. We recommend mentioning your smartphone as well especially if it has Android with installed Google identifier. Therefore we recommend pucjasing cheap smartphone which you will use solely for financial activity and install stock exchanges identifier. Some might consider such recommendations to be a simply banality though as practice shed they are capable to increase assets security level.

Cryptocurrency stock exchanges: signs of unreliability

Convenience, safety and reliability of stock exchange is the core aspect in case of constant trade on it or simple storage of existing assets there.

Stock exchanges most part of which present centralized services are frequently prone to hacker attacks. Unfortunately such cases are more than frequent. Longstanding assessment of resources which are directly or indirectly related to cryptocurrency market has allowed defining some indices of stock exchange unreliability, though not everyone manage to notice them at a glance.

Let’s remember several of such cases:

  • Sudden resignation of William Denis Attwood the single director of MyCoin. Generally such situation might make users cautious, while none has paid specific attention to such fact. In one month after well known Hong Kong stock exchange became bankrupt having made a lot of dissatisfied users to accept their mistake.
  • Cryptsy downfall! This process seemed to have been more predictive. This resource has been running some technical difficulties for several years, while users had some doubts about company management policy. In 2016 this stock exchange became bankrupt. This fact has been explained by hacker’s attacks. Though this statement has been argued in court the investiogation results have proved that this stock exchange owner simply transferred users money to his own accounts. While users who have lost their saving didn’t care this fact greatly.

Which signs traders should assess first?

In most cases cryptocurrency space is based on reputation and trust. In case if popular persons and companies of this sphere leave the project, such fact should be considered as extremely cautious.

Twisting policy and frequent technical issues should make cautious as well

As it has been mentioned by Livecoin.net director Svetlana Heller the difficulties with Bitcoin withdrawal is another reason to think about cryptocurrency safety. One can avoid the issue of Altcoins mobility, but it won’t be wise to avoid the matter of BTC mobility.

Other signs include the absence of transparency (though this sign is not always related to stock exchange unreliability), uncontrolled flow of doubtful currencies and slow answers to users tickets.

Finally, don’t invest all your savings in one project. Unpleasant situation might occur when you don’t wait for them and your ability to diversify such situations will mitigate risks.

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